By Kashmira Konduparty
Former Federal Reserve Chair Jerome Powell warned that the credibility of the U.S. central bank is under threat as it faces growing political pressure, marking his first public remarks since stepping down from the position last month, according to a report by Axios.
Speaking at the John F. Kennedy “Profiles in Courage” award ceremony on Sunday, Powell described the Federal Reserve’s current situation as a “stress test” for the institution and emphasized the importance of preserving its independence from political influence.
While he did not directly mention President Donald Trump or the White House, his remarks came after months of tension between the administration and the central bank. “The Fed’s credibility would be lost,” Powell said. “That credibility enables the Fed to support a strong and stable economy for the benefit of American families and businesses.”
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Powell’s term as the Fed chair ended on May 15 after leading the institution through the COVID-19 pandemic, inflation spikes and a period of economic uncertainty. President Trump selected former Federal Reserve Governor Kevin Warsh to succeed him, who took office in May.
Despite leaving chairmanship, Powell has chosen to remain on the Federal Reserve’s Board of Governors, a position he can hold into January 2028. He previously said he would continue serving for a period of time because of concerns about attempts to influence the central bank and ongoing legal disputes involving the institution.
In his speech, Powell acknowledged that “At the Fed, we are, of course, human and thus imperfect, when we make mistakes, we acknowledge them and change course.” He said democratic institutions, including central banks, courts and universities, rely on public confidence to function effectively. “We will make our decisions based only on our best economic analysis of what would most benefit the people we serve,” he added.
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The Federal Reserve had faced increasing scrutiny in recent months. The Trump administration repeatedly pushed for lower interest rates and supported efforts to investigate the Fed over its multibillion-dollar headquarters renovation project. The Justice Department later dropped its criminal investigation into Powell, although an internal review remains ongoing.
Warsh, a former Wall Street executive and Fed governor, has been critical of some recent Federal Reserve policies and has called for structural reforms within the institution. His appointment followed a lengthy confirmation process that became entangled in broader disputes over the Fed’s independence and the investigation into Powell.
Powell did not directly address his successor during the ceremony. Instead, he focused on what he described as the broader responsibility of protecting institutions from political pressure, arguing that maintaining public trust remains essential to the stability of the U.S. financial system and democracy.